Credit Suisse wants investors to know that a great brand is also a great investment.
Omar Saad, a Director at Credit Suisse and a U.S. Branded Apparel & Footwear analyst, said, “We believe a strong brand is one of the most powerful and sustainable advantages a company can have, but one that is often ignored by the financial markets. We believe brand stocks will continue to outperform the market, and our proprietary framework analyzes brand lifecycles to determine how and when to invest in brands for optimal returns.”
To that end, the financial giant released, “Great Brands of Tomorrow,” an in-depth look at how a company’s brand can be one of the few true competitive advantages remaining in modern industry. The report also lists 27 “Great Brands of Tomorrow,” which include: Alibaba.com, Almarai, Amazon, Apple, BIM, Capitec, China Merchants Bank, Commercial Aircraft Corporation of China, Enfamil, Facebook, Hyundai Motor, Indian Hotels, Julius Baer, Li Ning, Mahindra & Mahindra, MercadoLibre, Mercedes-Benz, Polo Ralph Lauren, Sonova Holding, Swatch, Tiffany & Co., Tingyi, Trader Joe’s, Tsingtao Brewery, Under Armour, Uniqlo, and Yakult Honsha.
Credit Suisse also notes that most brands follow a similar arc with five distinct stages: emerge, hit the wall, transform/proliferate, dominate and reinvent. Investing in companies that are transforming from niche player into a powerful brand that can be proliferated across new markets and categories offers investors extremely attractive returns, and is typically the phase in the brand lifecycle that generates the largest market value creation, according to the report.
